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Australia

Latest Development:

A minister Oct. 20 told a Senate committee that the government expects to introduce
TPP legislation to parliament early next year. Parliament's Joint Standing Committee
on Treaties is due to make its report in December. Oct. 28 was the last day for making
submissions to a separate Senate inquiry into the TPP conducted by the Senate Foreign
Affairs, Defense and Trade References Committee. The committee will report on Feb.
7, 2017.

Watch for This:

The Senate committee TPP inquiry is expected shortly to set dates for public hearings.

Interesting Item From TPP Text:

Provisions on pharmaceuticals and the investor-sate dispute settlement mechanism have
proved to be the dominant concerns in the two parliamentary inquiries. With respect
to ISDS, the debate has largely centered on whether they would stop or slow efforts
by governments to introduce “public good” legislation. Concerns about pharmaceuticals
have focused on the possibility that TPP ratification might slow access to cheaper,
generic versions of extremely expensive biologic medicines.

Ratification Status:

The only realistic pathway for ratification is for the coalition government led by
Prime Minister Malcolm Turnbull and the Labor opposition to team up to secure passage
of relevant legislation through the Senate. The two parties have done so with a number
of other free trade agreements. However, Labor so far has not publicly said whether
it will support TPP ratification.

Canada

Latest Development:

Prime Minister Justin Trudeau said it would be “difficult to imagine” Canada turning
its back on three of its top five trading partners by not signing the TPP. But former
prime minister Brian Mulroney, who signed the North American Free Trade Agreement
and its U.S.-Canada predecessor, said Canada’s position doesn’t matter because the
deal is doomed due to hostility in the U.S. Congress and global concerns about trade
initiatives.

Watch for This:

The House of Commons International Trade Committee is continuing its public hearings
on the TPP so it can provide a recommendation to the government on whether to ratify
the deal. No future meetings are currently scheduled, but the committee held its 40th
meeting on Oct. 27.

Interesting Item From TPP Text:

Canada expects to benefit from the deal’s expanded temporary entry for business people.
That's based on new commitments from Australia, Brunei, Malaysia and New Zealand to
permit business visitors providing after-sales service, new commitments from Chile
and Mexico on access for after-lease services and improved commitments on intra-company
transfers from Australia, Chile, Japan, Malaysia, New Zealand and Vietnam. It also
includes new commitments from Australia, Chile, Japan, Malaysia and Mexico to extend
temporary entry privileges, and the right to work, for spouses of Canadian business
people.

Ratification Status:

No progress is expected on ratification until after the Canadian Parliament’s ongoing
review of the TPP is completed, which is unlikely to happen before the U.S. presidential
election in November.

Chile

Latest Development:

President Michelle Bachelet named Paulina Nazal as the new director of the Economic
Relations Office of the Ministry of Foreign Relations. Nazal previously managed Chile's
relations with the Asia-Pacific Economic Cooperation forum, the Organization for Economic
Cooperation and Development and the World Trade Organization. She also led negotiations
for Chile on the TPP.

Watch for This:

The ruling center-left coalition suffered a heavy defeat in municipal elections across
Chile on Oct. 23, losing several key cities to the center-right opposition. The result
is seen as a bellwether for next year's congressional and presidential elections.

Interesting Item From TPP Text:

The TPP is the first major trade pact to include a chapter dedicated to small and
medium-sized enterprises (SMEs). The deal establishes a series of mechanisms to facilitate
their participation in international trade, such as improving access to information,
electronic documentations and special treatment for SMEs in government tenders. An
SME Committee, made up of the 12 member countries, will be responsible for sharing
information and promoting these benefits through seminars, workshops and websites.

Ratification Status:

The government has said several times that it will submit legislation to ratify the
TPP to Congress by the end of the year, although doubts have been raised whether this
is possible given the packed legislative agenda.

Mexico

Latest Development:

The Senate passed a key piece of labor legislation on Oct. 13 that would strengthen
collective bargaining rights in Mexico and better ensure protection of these rights
for workers. The legislation, known as the Labor Justice Amendment to the Constitution,
modifies existing labor laws to establish an independent labor court in place of the
current federal labor boards, which arbitrate all labor disputes. The legislation
also establishes a separate ministry to serve as a registry for collective bargaining
agreements, and provides some guarantees that access to all union contracts be provided
to workers. The right to collective bargaining is one of the International Labor Organization
provisions that must be upheld by all members of the TPP in order to receive benefits
from the agreement.

Watch for This:

Any amendment to the Constitution must be passed by 32 local legislatures and by the
House of Deputies by a two-thirds majority in order to go into effect.
These votes are expected prior to the end of the year.

Interesting Item From TPP Text:

The TPP requires all member countries to maintain the five labor freedoms established
by the International Labor Organization, including the freedom of association, the
right to collective bargaining, the elimination of forced labor, the abolition of
child labor and the elimination of discrimination in respect of employment and occupation.
All TPP parties must settle labor disputes through the same dispute settlement mechanisms
used for commercial disputes, which includes possible trade sanctions.

Ratification Status:

An analysis of the text is being carried out by nine separate committees in the Mexican
Senate, and leaders from the leading Institutional Revolutionary Party and the National
Action Party have indicated their support of the agreement. Several officials have
said a vote is planned before the end of 2016.

New Zealand

Latest Development:

A select committee of Parliament Oct. 27 released its report on the Trans-Pacific
Partnership Agreement Amendment Bill. It includes changes to clarify the commencement
date, an amendment to provisions on penalties for copyright breaches and regulation-making
powers on technological protection measures and on investment screening. The bill
would amend 10 existing laws.

The majority report recommends passage of the bill with amendments on various matters.

Watch for This:

Trade minister Todd McClay will give his “second reading speech” on the bill on Nov.
3, a step that starts the final stages of debate on the legislation.

Interesting Item From TPP Text:

Issues likely to crop up in debate on the bill include the ramifications of the TPP
agreement's copyright provisions, which the government has acknowledged will impose
a net cost on the country. The government says the net costs of extending the copyright
term from 50 years to 70 years will be vastly outweighed by other benefits of the
TPP.

Ratification Status:

The bill is likely to pass Parliament.

Peru

Latest Development:

Peru’s government is coming up on a nine-month deadline to respond to observations
of its labor legislation made by the U.S. Department of Labor under the bilateral
free-trade agreement that took effect in February 2009.
The Office of Trade and Labor Affairs, a division of the department’s Bureau of International
Labor Affairs, raised concerns about Peruvian legislation (Decree Law 22342) that
allows for the use of three-month temporary contracts on a permanent basis in certain
export sector, such as garments, to encourage investment and lower costs.

Watch for This:

Labor lawyers who filed the complaint with the Labor Department under the pact say
the manner in which the case is resolved could have an impact on the TPP, because
the Peru-U.S. trade agreement was used as a model for the TPP. The complaint calls
for Peru to repeal Law 22342 and a similar law that governs temporary contracts in
the agro-export sector (Law 27360), as well as strengthen its labor inspection division.
Both areas are also covered in the TPP Chapter 19 on labor issues.

Interesting Item From TPP Text:

Chapter 19, Article 19.4, states: “The Parties recognize that it is inappropriate
to encourage trade or investment by weakening or reducing the protections afforded
in each Party’s labor laws. Accordingly, no Party shall waive or otherwise derogate
from, or offer to waive or otherwise derogate from, its statutes or regulations.”

Ratification Status:

While Peru’s Congress has not yet started debate on the TPP, President Pedro Pablo
Kuczynski’s government maintains that it will be approved this year.

United States

Latest Development:

The Office of the U.S. Trade Representative Oct. 27 hosted a conference call with
business leaders on how to pressure Congress to hold lame-duck votes on the TPP. The
business leaders are organized by Business Forward, which has hosted fly-ins of business
executives for White House briefings on the TPP. The next outreach effort will be
directed toward Congress.

Watch for This:

The most important outstanding issue for lawmakers is the term of intellectual property
rights protection for biologic drugs. Watch for any sign that the administration and
Senate Finance Committee Chairman Orrin Hatch (R-Utah) have reached an agreement on
a “fix” for the problems highlighted by the senator. Those problems include the discrepancy
between the 12-year term of exclusivity protection afforded to brand name manufacturers
in U.S. and the two options outlined in the TPP.

Interesting Item From TPP Text:

Article
18.51 of the TPP concerning biologics states that countries must provide one of two
options: “a period of at least eight years”
of marketing exclusivity protection or at least five years of test data exclusivity
and “other measures” that “deliver a comparable outcome.” There is no time element
associated with the “other measures” but it is widely assumed that the “comparable
outcome” means that they would comprise at least three years to be equivalent to the
first option. This section also says that the TPP parties would consult after 10 years,
or as otherwise decided, to review the period of exclusivity.

Ratification Status:

Senate Majority Leader Mitch McConnell (R-Ky.) is standing by his position that the
TPP will not ratified this year and instead will be left for the next president. Others
on Capitol Hill said work on moving the agreement in 2016 is proceeding behind the
scenes among the staffs of the Senate Finance and House Ways and Means committees.

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